Excessive Price Volatility in the California Ancillary Services Markets: Causes, Effects, and Solutions

✍ Scribed by Afzal S. Siddiqui; Chris Marnay; Mark Khavkin

• Publisher: Elsevier Science
• Year: 2000
• Tongue: English
• Weight: 330 KB
• Volume: 13
• Category: Article
• ISSN: 1040-6190
• DOI: 10.1016/s1040-6190(00)00125-1

✦ Synopsis

An analysis suggests that price volatility has been caused by generators' exercise of market power. The response by the California ISO has included the imposition of a fixed price cap and reforms intended to curb market power; but mechanisms used in other restructured electricity markets could have been considered, such as threats of regulatory action and use of hedge contracts.